Money WondersPlay

Saving & Compound InterestCompound Interest

Interest on Interest

Compound interest turns a straight line into a curve

Two jars, $1,000 each, both at 5%. Forty years later one holds $3,000 and the other $7,040. What happened?

You'll find out

  • How interest earns interest
  • Why the first 10 years look dull
  • What a higher rate does to the curve

Why it matters

Compounding is how small sums turn large, in savings and in debt. It's the most important curve in money.

About 3 min6 interactive slides · 5 questionsLesson 39 · Zone 5

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